Steve Jobs Illness Raises Questions Regarding Executive Medical Privacy
Steve Jobs, who has presided over every major Apple product launch since 1997, has not had control of the day-to-day operations of the company since handing them over to Tim Cook on January 14th of this year. In the interim, the health of Jobs has become a hot and much speculated about topic.
Now that stories have circulated that Jobs had a liver transplant, questions have arisen regarding the medical privacy of executives at publicly traded companies and just how much information such companies should be required to disclose.
Nell Minow, the co-founder of The Corporate Library, believes that CEOs and boards of public companies have a duty to be transparent about such medical issues, especially when the individual in question is as important as Jobs is to Apple.
According to an article published today at Bloomberg.com, Minow said the following:
“The CEO of a public company cannot have the luxury of privacy about significant medical matters, especially when he is a central part of the company’s brand and a core asset,” Minow said in an e-mail. “A board of directors has to insist on and provide frankness to the company’s constituents — including its shareholders — about the CEO’s health and its impact on his availability to the company.”
However, many other observers believe that, at least in Apple’s case, the company’s lack of disclosure regarding the nature of Jobs’ absence is acceptable. First off, the Bloomberg article cites a law professor who says that companies do not have a legal obligation to disclose information related to executives’ health. Additionally, because Apple has continued to perform well in Jobs’ absence, they may be playing their cards just right.
The board may “be getting it right because the company is in good shape, they’re not giving messages that he’s peachy keen or coming back full time,” [John] Dienhart said. “If people were worried about Apple’s team and they weren’t meeting expectations or the products weren’t as good as they were promoted to be, then Jobs’s health becomes more important from an investor point of view.”
Still others, like Jeffrey Sonnenfeld of Yale University, believe that while Apple is not required to provide “hourly update” regarding Jobs’ health, the company does need to take proactive steps like naming an interim CEO in Jobs’ absence.
The ongoing story regarding Steve Jobs’ illness and health, and Apple’s strategy for handling it, raises a number of interesting questions. Among the questions are:
- What level of responsibility do/should public companies have to release information about the health of executives?
- Would Apple be handling information related to Steve Jobs’ illness and health differently if the company was not continuing to perform well?
Use the comment section below to answer and begin a discussion.
Tags: Apple, corporate governance, Steve Jobs
